Article Testing Point & Figure Patterns

T2W Bot

Staff member
1,452 54
Point-and-figure (P&F) charts have been a part of the technician’s toolbox for more than a century. They were used by Charles Dow in the late 1800s and Victor deVilliers published the first detailed explanation of this technique in 1933 in his book, “The Point & Figure Method of Anticipating Stock Price Movements”. P&F charts track only price changes and ignore time. Proponents of this technique believe that focusing solely on price changes eliminates day-to-day market noise. By ignoring smaller movements, traders believe that it should be easier to identify significant support and resistance levels. In this article we’ll introduce you to several popular P&F patterns that may be useful in identifying potential breakouts.
Using a Traditional ToolThe simplest trade signals on a P&F chart are double tops and double bottoms (Figure 1). A double top buy signal occurs when a column of Xs, which are used to note rising prices, exceeds the top of the previous X column. A double...
Continue reading...
 
Last edited by a moderator:

Similar threads


AdBlock Detected

We get it, advertisements are annoying!

But it's thanks to our sponsors that access to Trade2Win remains free for all. By viewing our ads you help us pay our bills, so please support the site and disable your AdBlocker.

I've Disabled AdBlock